FERC on April 14 approved filings by NYISO and ISO-NE authorizing them to collect tariffs on electricity imports from Canada, if the “relevant federal authorities” deem them responsible for doing so (ER25-1462, ER25-1445).
The grid operators have said President Donald Trump’s tariffs on energy imports do not appear to apply to electricity. However, to prevent potential financial consequences, both saw the need to establish a framework for collecting them.
The commission accepted both grid operators’ proposed open access transmission tariff revisions for allocating Trump’s tariffs. NYISO proposed to charge the “financially responsible party,” while ISO-NE proposed to charge “the entities selling the assessed electricity into the ISO-administered market.” (See ISO-NE Braces for Tariffs on Canadian Electricity and NYISO Preparing to Collect Duties on Canadian Electricity Imports.)
Both grid operators wrote that their cost collection methods would allow importers to include the costs of the duties in market offers. The mechanisms could change if the federal government gives clear instructions to them to collect the tariffs differently. ISO-NE included in its proposal a provision allowing it to collect the duties “in accordance with any federal regulations or guidance,” while FERC directed NYISO to add a similar provision in an additional filing.
FERC emphasized that it makes “no finding regarding whether import duties imposed pursuant to the Canadian tariff executive order apply to Canadian electricity or whether [the grid operators are] required to pay them,” and similarly declined to rule on whether it is legal to apply the import duties to electricity.
Because of the “exigent circumstances present,” FERC directed both grid operators to file “any legal and/or technical guidance and related documentation from the relevant federal authorities showing that a federal agency has assessed an import duty on Canadian electricity imports” that triggers the grid operator’s collection authority, “as soon as practicable after receiving such invoice.”
If they do start collecting the tariffs, the grid operators must provide informational filings to FERC every six months for three years about the costs of the duties.
ISO-NE’s proposal is intended to be a temporary mechanism; if the RTO anticipates tariffs lasting longer than 120 days, it must file a permanent cost collection method within 120 days of the first import duty invoice.
ISO-NE responded: “We still believe the tariffs do not apply to electricity, and that if they do, ISO-NE would not be the entity responsible for implementing them. There is a lot of uncertainty around the situation, and the proposal is a proactive move covering one possible outcome.” They also published a press release, saying ” the ISO is committed to maintaining ongoing dialogue with our stakeholders, state officials, and the federal government.”
NYISO said it had no further comments.
